Hoyer Decries Bush Economy, Calls for a New Direction That Works for More than Just the Wealthy Few

WASHINGTON, DC Congressman Steny H. Hoyer (D-MD) today delivered an economic address at the University of Maryland as part of a national effort by House Democrats to highlight their agenda promoting economic security, opportunity, and prosperity for all of Americas families. Below are his remarks, as prepared.

Within the next 3 or 4 years, you will graduate and start looking for a job.

So you have a major stake in how our nations economy is run. I urge you to start paying attention now to the choices being made by your leaders in Washington.

Two weeks ago, President Bush said, I certainly hope this election is based upon economic performance. We agree on that point, but looking at the latest economic figures, I have to wonder why the President would wish that upon himself.

The economy under President Bush has not been a good one for working families.

Since 2001, real incomes for middle-class families have declined but the costs of basic family needs have risen dramatically.

You are personally experiencing that with drastic increases in college costs every year.

Since 2001, tuition and fees at four-year public universities have exploded by 57% or about $1500 a year. And on average, each of you will graduate with $17,500 in debt, but the people in charge have increased the cost of student loans.

Here at Maryland, tuition has gone up 45% just in the last three and a half years.

Energy costs for average American families are approximately $2,500 more a year than they were five years ago.

At the same time that everything is becoming more expensive, almost everyone is earning less.

Overall, household income has dropped nearly $1,300 since 2001. The numbers are worse for younger, working families  income for households excluding senior citizens, who tend to be on a steadier income, dropped by a total of almost $3,000 in that time.

Real wages, adjusted for increases in the cost of living, have declined. Productivity is up, which means workers are producing more faster, but they arent being compensated for it. The workers share of national income has declined by nearly 3% since 2001, but corporate profits have increased by nearly 6%.

That is one of the contributing forces to the greatest legacy of the Bush economy  a drastic rise in income inequality.

Virtually all of the increased wealth generated since 2001 has gone to corporate profits and the very small group of individuals who stand to benefit the most from corporate profits.

Dont get me wrong. Companies are in business to make money and making money is a good thing.

But our nation has thrived because of a vast distribution of wealth; we are who we are because we have a broad and prosperous middle class.

When you think of America  do you think of us as a nation divided between have and have nots? I didnt think so.

But today the trends are going in the wrong direction.

While the wealthiest 10% of families have seen strong gains in real income, the remaining 90% have seen their real incomes fall since 2001. And as incomes fell for the vast majority of families, the very wealthiest in our society, the 14,400 families making more than $5 million a year, enjoyed income gains of nearly 14%.

The pain is worse for the working poor  millions of whom still work at the minimum wage. And while you all will no doubt go on to well-paying careers, that is not the case for everyone in our society.

The minimum wage is at its lowest level in 50 years. It has been 9 years since the last increase in the minimum wage, the second longest period without a wage increase since the minimum wage law was first enacted.

The national minimum wage of $5.15 is now at its lowest level in 50 years when adjusted for inflation. Had the 1968 rate of $1.60 per hour (highest in terms of relative purchasing power) been indexed its value this year would be $9.05.

A minimum wage increase would benefit poor workers who need it most: 58.5% of the gains from the proposed $2.10 increase would go to working households in the bottom 40% of the income scale.

Meanwhile, the Republican tax agenda has helped the wealthy while neglecting the middle class. They refused to extend this year the law that allows some of your parents to deduct part of your tuition from their taxes  affecting more than 90,000 people in Maryland alone.

They have tied themselves in knots trying to eliminate the estate tax.

Business tax incentives have continued to ship jobs overseas.

They have piled more than $3 trillion in additional debt on the next generation of Americans  meaning you.

Democrats propose a new direction on the economy.

We believe that all Americans deserve the opportunity to achieve the American Dream for themselves and their children.

We will make the economy more fair by raising the minimum wage and repealing subsidies for companies to send jobs overseas.

We will make health care more affordable by lowering costs for prescription drugs and expanding coverage for the self employed and small business owners and workers.

We will make college more affordable by cutting interest rates for student loans and making college tuition deductible from taxes.

We will cut the interest rate on new student loans in half  from 6.8 percent to 3.4 percent; cut the interest rate on new parent loans in half  from 8.5 percent to 4.25 percent; saving the typical undergraduate student borrower $5,600 in loan costs.

We will accomplish this with fiscal discipline.

This is the most fiscally irresponsible Administration in American history, and its fiscal legacy will be one of exploding deficits and dangerous debt.

In five years, the Bush Administration and Congressional Republicans turned a projected 10-year budget surplus of $5.6 trillion into a projected deficit of $4 trillion in large part by enacting unaffordable tax cuts at a time of war.

For all his public hand-wringing over Congressional spending, President Bush has failed to veto any of the bloated spending bills the Republican Congress has sent him. Not one.
At $296 billion, the projected budget deficit for Fiscal Year 2006 would still constitute the fourth largest deficit in American history.

Democrats will restore common sense pay as you go rules that say any increase in spending or decrease in revenue, such as tax cuts, must be offset by decreases in spending elsewhere or increases in revenue.

Pay as you go policies helped create four years of surpluses under Clinton.

Democrats would also require that budget plans achieve balance.

The most important thing on your mind when you graduate is going to be finding a job.

As you are well aware, the job market right now is not the greatest.

The Presidents economists claimed passage of the tax cuts would result in job gains of 306,000 per month. Monthly job creation has not even gotten close to that level.

President Clinton created almost 220,000 jobs a month on average. President Bush has created 28,000 a month on average.

Democrats have a plan to create jobs called the Innovation Agenda.

The Innovation Agenda is our commitment to competitiveness and to keep America number one in the world.

Last week, the World Economic Forum announced that the United States lost its position as the worlds most competitive economy, dropping from first to sixth. The out of control budget deficit, which stifles investment in innovation, is one of the main reasons.

We want to create 100,000 new scientists, engineers, and mathematicians in the next four years by providing scholarships, other financial assistance, and private sector opportunities to college students.

We want to provide universal broadband service so that everyone can participate in the internet economy. The internet is an everyday resource for you, but is hard to access for many Americans.

Imagine how much harder it would be for you to write your papers, conduct research and learn without access to the internet. Wouldnt that slow you down, make you less productive and less knowledgeable?

We want to create a competitive environment for small businesses, which are the engine of domestic job creation.

We will double our commitment to basic research and development.

And, we will make a commitment to energy independence.

I recently introduced the PROGRESS Act or Program for Real Energy Security, which will create a Manhattan Project-like effort to make efficient cars and trucks that run on alternative fuels, and make sure that those fuels are available at gas stations around the country.

I urge you to start paying attention now to the choices being made in Washington today, because they will affect you tomorrow.

Democrats are hoping that we can join together to take our nation in a new direction on the economy.

We want our economy to work for you, and all Americans  not just the wealthy few.